< em>I said God damn, The Pusher -Steppenwolf
I'm starting to feel guilty.
I don't have a sub-prime mortgage, credit cards or a car payment. My PDA is two years old and my television is three. Restaurants and books are the only categories where I spend more than the national average. I've never flipped a condo.
The recent economy was based on all the things I don't do.
Now a lot of people are joining my ranks. I saw a Wall Street Journal article headlined, "New Frugality Worsens Downtown".
It's as if The Powers That Be are unhappy that consumers are getting their act together.
It's similar to a dope dealer getting angry when a customer goes into rehab.
To some, the crisis was caused by consumers. Not by the greedy bankers on Wall Street and their friends in Washington. Not a decade of terrible leadership from the Federal Reserve. Not the lobbyists who pushed legislation that let corporations run wild.
No, the economic crisis was our fault. They want to blame those of us who managed some sanity while everyone else was going crazy.
I think the crazy ones are those who are waiting for consumers to go wild again. It is going to take a few years. In fact, it may take a few decades.
We are entering the post crazy economy.
Even before the $700 Billion bailout of Wall Street fat cats, it was obvious that Washington didn't get it. When we first started into an economic downturn in 2007, the response was to waste hundreds of billions on stimulus checks.
The only thing they stimulated was the deficit, followed by an economic crisis a few months later.
Now, good savings habits are suddenly cool. It's like all of us are rushing to frugality.
No one is wowed by your shiny new car and big house. They are all wondering how you can pay for it. When someone tells me they are going on a shopping spree, I feel sorry for them. I wonder if they will be paying off the spree twenty years from now.
A lot of people think this is a temporary downturn. They think we will get through this crisis and go back to spending like it was 2005.
I don't think so. This is like the shock that our grandparents felt with the Great Depression.
My grandmother worked in a potato chip factory. She never had a car, credit cards or designer anything. She also never had debt. She managed to save money on a very meager salary.
It wasn't a bad lesson to learn. There have been a few blips in history where people have spent like crazy, but, for the most part, people historically lived on what they earned. Credit cards and sub-prime are relatively new ideas that haven't really worked out.
We are headed back to our grandparents' way of thinking. The rest of the world has already beaten us to it. The United States has one of the worst savings rates in the world and it will be hard to compete until we catch up.
People who built companies based on crazed spending may have to rethink their business models. No one is going to feel sorry for a sub-prime mortgage broker or a credit card company going under.
People are going to look at them the same way society looks at drug pushers: Businesses that enabled users to get completely out of control.
Once we completely say, "God Damn" to the credit pushers, we will be on our way to a successful post-crazy economy.
Like any time an addict recovers, the world will be better for it.
Don McNay, CLU, ChFC, MSFS, CSSC is the founder of McNay Settlement Group in Richmond, Kentucky. He is an award winning, syndicated financial columnist and the author of two books. You can write to him at email@example.com or read his previous columns at www.donmcnay.com. Don is Treasurer of the National Society of Newspaper Columnists.